UnitedHealth tops Q1 forecasts, raises 2022 outlook

Apr 14, 2022, 3:37 AM | Updated: 9:40 am

UnitedHealth Group delivered a better-than-expected first quarter and raised its 2022 forecast, as growth in Medicare Advantage and care delivery once again helped the health care giant.

The nation’s largest health insurance provider said Thursday that enrollment in its Medicare Advantage plans grew nearly 9% to about 6.9 million people, and the company also booked growth in other government-funded coverage. Its larger commercial enrollment stayed nearly flat.

UnitedHealth is the biggest provider of Medicare Advantage plans, which are privately run versions of the federally funded Medicare program.

The company runs UnitedHealthcare, a health insurance business that covers more than 50 million people mostly in the United States. It also has been squeezing more growth out of its Optum segment, which runs one of the nation’s largest pharmacy benefit managers and a growing number of clinics and urgent care and surgery centers.

First-quarter operating earnings, which don’t count interest expense and taxes, slid for the company’s health insurance business but jumped almost 20% to $3.2 billion for Optum compared to last year.

UnitedHealth said the revenue it drew per customer from its care-providing Optum Health business grew by 33% as the company expanded deeper into value-based care. That involves reimbursing doctors based more on the patient’s health instead of for each service provided.

UnitedHealth and competitors like the drugstore chains CVS Health and Walgreens are all trying to become regular sources of care for more customers, especially those with Medicare Advantage plans.

The idea is that regular care will keep patients with chronic health problems like diabetes healthy and out of expensive hospitals. It’s an approach gaining favor with bill payers like insurers and employers.

Overall, UnitedHealth earnings grew more than 3% to $5.03 billion in the first quarter, even though the company’s largest expense, medical costs, climbed 17%.

Company leaders told analysts Thursday morning that UnitedHealth started the quarter with about 40,000 COVID-19 hospitalizations in January. That marked the highest total of any month since the pandemic started more than two years ago.

That total then dwindled to about 2,000 hospitalizations by March, as the omicron surge of virus faded.

UnitedHealth’s adjusted results totaled $5.49 per share in the first quarter, and total revenue jumped more than 14% to $80.1 billion.

Analysts expected, on average, earnings of $5.36 per share on $78.73 billion in revenue in the second quarter, according to FactSet.

For the full year, UnitedHealth now expects adjusted earnings of $21.20 to $21.70 per share. That’s an increase of 10 cents on both ends of the range from a forecast it laid out late last year.

FactSet says analysts expect earnings of $21.61 per share for 2022.

UnitedHealth’s forecast hike was conservative compared to how much the company beat first-quarter expectations, Jefferies analyst David Windley said in a research note. But he added that this was expected given the unknown nature of the pandemic.

Shares of Minnetonka, Minnesota-based UnitedHealth Group Inc. climbed slightly to $538.09 in Thursday afternoon trading. The Dow Jones Industrial Average, of which UnitedHealth is a component, also rose slightly.

UnitedHealth’s share price has more than doubled over the past couple years.

___

Follow Tom Murphy on Twitter.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

This photo provided by Robert Wilkes, owner of a house boat management company, shows smoke rising ...

Associated Press

Houseboats catch fire while docked at Wahweap Marina on Lake Powell

More than half a dozen house boats momentarily caught fire at a popular boating destination on the Utah-Arizona line on Friday.

22 hours ago

File - Women work in a restaurant kitchen in Chicago, Thursday, March 23, 2023. On Friday, the U.S....

Associated Press

US hiring, unemployment jump in May and what that says about the economy

The nation’s employers stepped up their hiring in May, adding a robust 339,000 jobs, well above expectations.

22 hours ago

(Pixabay Photo)...

Associated Press

Oath Keeper from Arizona sentenced for role in Jan. 6 riot at US Capitol

Edward Vallejo, a U.S. Army veteran from Phoenix, oversaw a “Quick Reaction Force” at a Virginia hotel that was prepared to deploy an arsenal of weapons into Washington if needed, authorities say.

2 days ago

FILE - U.S. Border Patrol Chief Raul Ortiz listens during a news conference, Jan. 5, 2023, in Washi...

Associated Press

US Border Patrol chief is retiring after seeing through end of Title 42 immigration restrictions

The head of the U.S. Border Patrol announced Tuesday that he was retiring, after seeing through a major policy shift that seeks to clamp down on illegal crossings at the U.S.-Mexico border following the end of Title 42 pandemic restrictions.

3 days ago

FILE - President Joe Biden talks with House Speaker Kevin McCarthy of Calif., on the House steps as...

Associated Press

House OKs debt ceiling bill to avoid default, sends Biden-McCarthy deal to Senate

The House approved a debt ceiling and budget cuts package late Wednesday, as President Joe Biden and Speaker Kevin McCarthy assembled a bipartisan coalition of centrist Democrats and Republicans against fierce conservative blowback and progressive dissent.

3 days ago

Sean Bickings (Family Photo via city of Tempe)...

Associated Press

Family of man who drowned last year in Tempe Town Lake files wrongful death lawsuit

The family of a man who drowned in Tempe Town Lake a year ago filed a wrongful death lawsuit against the city Wednesday, noting that its police department doesn't have a policy requiring officers to go into the water to save someone.

3 days ago

Sponsored Articles

...

DAY & NIGHT AIR CONDITIONING, HEATING AND PLUMBING

Here are the biggest tips to keep your AC bill low this summer

PHOENIX — In Arizona during the summer, having a working air conditioning unit is not just a pleasure, but a necessity. No one wants to walk from their sweltering car just to continue to be hot in their home. As the triple digits hit around the Valley and are here to stay, your AC bill […]

...

OCD & Anxiety Treatment Center

5 mental health myths you didn’t know were made up

Helping individuals understand mental health diagnoses like obsessive compulsive spectrum disorder or generalized anxiety disorder isn’t always an easy undertaking. After all, our society tends to spread misconceptions about mental health like wildfire. This is why being mindful about how we talk about mental health is so important. We can either perpetuate misinformation about already […]

...

re:vitalize

Why drug-free weight loss still matters

Wanting to lose weight is a common goal for many people as they progress throughout life, but choosing between a holistic approach or to take medicine can be a tough decision.

UnitedHealth tops Q1 forecasts, raises 2022 outlook